New American Home Shield president sees big potential
April 17, 2013
New American Home Shield president Mark Barry recently visited the Carroll service center and visited with local employees as well as Carroll officials. Pictured are (from left) Carroll Area Deveopment Corportion executive director Jim Gossett, Barry, Carroll Mayor Adam Schweers and American Home Shield vice president of field services Dave Quandt.
Seeing excellent potential for growth in the home warranty industry, Mark Barry recently took reins as president of American Home Shield, the No. 1 provider of that service in the U.S.
American Home Shield and Barry's success are strongly tied to the Carroll area's economic health since the company, which opened a service center here 25 years ago, is one of the community's largest employers. American Home Shield, a subsidiary of ServiceMaster, employs nearly 1,600 people at service centers in Carroll, LaGrange, Ga., and Memphis. Tenn. Carroll employs a peak of about 450-460 during the busy summer air conditioning season. LaGrange employs approximately 400 and Memphis 600.
Barry most recently served as president of United Technologies' Automation and Control Solutions, a $3.2 billion Hartford, Conn.-based unit of UTC's climate, control and security business. He previously served as president of GE Security-Americas before it was acquired by UTC in 2010.
Before joining GE Security-Americas, he spent seven years at Tyco International, including five as president of Tyco's fire and security services Asia division, based in Singapore. In that position, he led a multinational team of 11,000 employees in 12 countries, growing the division to $1 billion in annual sales of its electronic security systems, fire-protection, detection and suppressions systems and related services.
In his career, Barry said in a recent phone interview, he saw the penetration of household-alarm systems jump from about just 2 percent in the early 1990s to close to 30 percent.
"The (home-warranty) industry has the same potential to do that," he says, "We are passionate about our commitment to grow in the real estate space, but we also know that we have the potential to grow beyond that niche and reach even more households."
American Home Shield serves more than 1.3 million customers across 49 states, and is by-far the No. 1 provider in the industry.
Barry says a key to growth is getting the message to prospective customers on the value of American Home Shield warranties.
American Home Shield has led the industry in selling renewable-service contracts covering repair or replacement of appliances and home-system components - such as air conditioners and furnaces.
Barry points out, "Our customers use our product and use it often. On average, our customers have two claims a year; they're active users of our productand they get value from what we provide.
"And the customers who select us directly have very high retention rate - good long customer life."
Looking for ways for American Home Shield to grow, Barry says, "While maintaining and continuing to grow the traditional real-estate base where the product is part of the transaction, in relatively recent years we've started going directly out to consumers, and we've had very good success with that. Customers like the product."
He adds, "It's a matter of getting the equation right on identifying and attracting new customers in an affordable way. I think the opportunity to acquire customers is very strong."
Barry says home warranties appear to particularly fit today's busy lifestyles.
"It takes the hassle out, where you don't have to go to the Internet or phone book shopping to find a contractor," he says. "We can get that done for them. That's part of the value.
"The big thing is that they save money. They have the predictable cost in the form of their premium."
Contrast that, Barry says, with paying full expense for a repair or replacement, especially in a time when cash flow may be difficult.
Last year, associates at American Home Shield's three centers handled over 4 million service-department calls.
"That's a lot of help being delivered," says American Home Shield communications director Nicole Ritchie, who's based in Memphis.
Over the last five years American Home Shield scheduled 14 million service visits by contractors and spent more than $1.6 billion resolving customers' needs.
Since becoming American Home Shield president, Barry has held what he calls town-hall-communications meetings, visiting the Carroll, LaGrange and Memphis centers.
Last month he visited Carroll and received input from department representatives and also visited with Carroll Mayor Adam Schweers and Carroll Area Development Corporation executive director Jim Gossett.
Barry says he's impressed that American Home Shield's employees are "incredibly well-focused" and the business is a "well-operating organization."
Barry says his plans are to "understand and preserve things historically we've done incredibly well, such as the contractor-management process. But we'll also look toward the future. A big part of where I need to spend my time is how we evolve - what we do in the future so we can change with the times. That will manifest itself in what our product offering should look like."
Asked what strengths and style he can lend to the company, Barry says, "I have to make sure we're looking at the right things, whether it's the right sales methods or right profit methods - make sure our activities are aligned with our goals. ... I see my role as keeping everybody together and going the same way."
Barry cites more effort not only on expanding American Home Shield's base of prospective customers but also improving retention of warranty holders.
"The focus historically has been more on new-customer acquisition every year," he says. "We'll try to change that model, try to get customers to think of our product not as a one-year agreement but an ongoing service relationship that isn't bound by time. We're starting to have success in that. Our renewal rates are climbing."
Communications director Ritchie says Barry has also made it a priority to improve customers' experience with American Home Shield. She says a number of changes have taken place in recent months that are helping the company reach this goal.
"Calls to our service centers are being answered faster and contractors are being scheduled faster. We're working differently, and there have been improvements across-the-board," she remarks.
American Home Shield has introduced goals tailored to each department. Barry says that has empowered employees, giving them more ownership of the operation. And they've been surprised by how quickly they've met or exceeded goals, he adds.
Discussing Carroll's future in the American Home Shield family, Barry says, "The Carroll center is a very special place. It's been around a long time. There's a lot of seniority and highly skilled people there. In our company, we do some of our most complicated work in Carroll."
For instance, Dave Quandt, who's been with American Home Shield since the Carroll center opened, is vice president of field services. Among his responsibilities is maintaining a network of nearly 10,000 contractors. According to the company, it's the largest network of independent, pre-screened professional service contractors in the nation.
"We manage across multiple trades," Barry notes. "Some contractors do plumbing, some do electrical, some do HVAC, some do appliances, and some do a mix. So that's a skill inventory that's very complicated."
The Carroll center currently is facing the challenge of growing the Carroll workforce.
Quandt says the Carroll center is battling a low unemployment rate in the area in its need for top-notch salespeople who are willing to work flexible hours, including evenings or weekends. American Home Shield customer-call activity increases in late afternoon and early evening and is also heavier on weekends or early in the week.
Barry says, "The flexible hours is important because we try to be available when our customers need us. We've been working to expand our evening and weekend shifts, and that's particularly been challenging in the Carroll area."
That's one takeaway Carroll Mayor Schweers and Carroll Area Development Corporation director Gossett received in their meeting with Barry, and they said they would work to address that concern.
While all of the company's call centers have added work force, Barry says the Carroll area's low unemployment rate and the company's transition to more night and weekend shifts has made for a more challenging recruiting environment.
Carroll has hired more than 30 new employees this year, but Barry says "We'd like to grow more, and we will. Plus we have the space to do so."
Joining American Home Shield, Barry succeeded David Crawford, who retired after more than 25 years with the company including the last six years as president.
Barry reports to ServiceMaster interim chief executive officer John Krenicki. ServiceMaster is one of the world's largest residential and commercial service networks. ServiceMaster is based in Memphis and besides American Home Shield its brands include Terminix, TruGreen, ServiceMaster Clean, Merry Maids, Furniture Medic and AmeriSpec. Those brands provide an array of services including termite and pest control; lawn, tree and shrub care; furniture repair; home inspections; home cleaning; janitorial services; and disaster restoration.